European Parliament delegation concludes visit to Malta to investigate rule of law

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The delegation concluded its visit stressing that the rule of law is the EU’s basis for mutual trust and the perception of impunity in Malta cannot continue.

The delegation, composed of members of the European Parliament’s Committee on Civil Liberties, Justice and Home Affairs and the Parliamentary Inquiry Committee into Money Laundering, Tax Evasion and Tax Avoidance visited Malta between 30 November and 1 December to look into the state of the rule of law and the implementation of European anti-money laundering legislation (AML) in the country.

Members met with the most relevant actors in those areas, including the Prime Minister, the Minister of Justice, the Chief Justice, the Police Commissioner, the Attorney General, the Financial Analysis Intelligence Unit (FIAU), the Financial Services Authority (MFSA), non-governmental organisations and anti-corruption activists, media, representatives of the Pilatus Bank and of KPMG Malta.

All the invitees accepted to meet the Delegation, except for Nexia BT director.

Concerns

During the meetings, the MEPs expressed serious concerns about the unclear separation of powers, which has been the source for the perceived lack of independence of the judiciary and the police, the weak implementation of anti-money laundering legislation, the serious problems deriving from the ‘investments for citizenship programme’, and the mentions of Maltese politically exposed persons in the Panama Papers and their continuing presence in government. Members noted the low rate of investigations and absence of prosecution by the Maltese authorities on these cases, as well as with regards to private sector actors involved, such as Nexia BT and Pilatus Bank.

The delegation’s leader Ana Gomes (S&D, PT) underlined that the rule of law in the Member States, whether it is Malta or any other EU country, is of great concern to all: “The rule of law is a matter of collective security. The brutal assassination of Daphne Caruana Galizia was aimed at instilling fear in everyone, especially those involved in investigating and prosecuting cases of money laundering and corruption. We are worried about the low number of cases that are being prosecuted in the area of financial crimes. This impunity cannot continue”, she said.

Ms Gomes also expressed concerns about the “accumulation of powers with the Attorney General”, which she feels “are not fully used when it comes to fighting corruption and money laundering”. She added that, “Malta is not yet fully implementing the 4th Anti Money Laundering directive” and that it is blocking an agreement on the 5th one, which aims at increasing transparency when it comes to real owners behind companies and trusts. She also pointed out that Malta has decided not to join the European Public Prosecutor Office (EPPO), which aims at fighting fraud involving EU funds and protecting the financial interests of the Union.

EU passports

Also of great concern was the sale of Maltese passports to foreigners, without disclosure of who these persons were. “This system, with all its opacity, bears the risk of importing criminals and money laundering into the whole EU”, Ms Gomes said.

Next steps

The delegation Members will now draw-up a report, which will be made public and forwarded to the European Parliament’s Conference of Presidents which brings together the EP’s President and the leaders of the political groups.